Australia Begins Bid to Join WTO Govt Procurement Pact

11 June 2015

Australia has officially begun its bid to join the WTO’s Government Procurement Agreement (GPA), government officials announced last week.

This bid makes Australia the latest in a series of countries working to join the plurilateral WTO deal, with the others negotiating accession being Albania, China, Georgia, Jordan, Kyrgyzstan, Moldova, Montenegro, New Zealand, Oman, Tajikistan, and Ukraine.

Australian Trade Minister Andrew Robb has highlighted the increased opportunities for his country’s businesses when competing in GPA markets, such as the EU, US, Japan, and Korea, as part of the motivation driving Canberra’s bid, according to a statement released by his office announcing the bid.

“Membership of the GPA would mean our firms will be able to participate on an equal footing with local competitors in GPA member countries,” Robb said.

Australian officials say that the move is in line with Canberra’s goal of increasing Australian businesses’ access to export markets, as well as increasing global competition for suppliers. The accession bid already has the backing of Australia’s state and territory governments, according to the statement from Robb’s office.

Next steps

The launch of Australia’s bid was discussed at the latest meeting of the WTO’s Government Procurement Committee, according to sources familiar with the talks. The actual accession negotiations themselves will begin when Canberra sends in its initial market access offer.

The process for acceding to the GPA proceeds on two levels. First, Australia will need to negotiate with current GPA parties to determine the level of “coverage” that Canberra will commit to under the deal. Coverage is defined by the procuring entities included; goods, services, and construction services covered; threshold values above which procurement activities are covered; and exceptions to such coverage.

Secondly, accession will depend on verifying that existing procurement legislation in Australia complies with GPA standards of transparency, minimising corruption, and fairness to all suppliers. Once all GPA members agree to Canberra signing on, which may require submitting multiple offers, Australia will then need to ratify the deal domestically.

Revised GPA

The GPA has 15 parties comprising 43 WTO members, given that the EU’s 28 member states are also individually members of the global trade body. The GPA is one of the few WTO deals that does not include the global trade body’s entire membership.

Parties to the GPA have signed onto a series of rules aimed at ensuring transparency and fairness within the public procurement of goods, services, and capital infrastructure, with an eye toward increasing foreign competition and ensuring the “transparent, open, and fair” procurement across countries.

Currently, government procurement accounts for 10-15 percent of a country’s economy on average, according to WTO figures.

While the agreement has been in force since 1996, the deal was later revised, with the new version agreed in 2011 at the WTO’s Eighth Ministerial Conference. The revised GPA then entered into force in April 2014. (See Bridges Daily Update #1, 15 December 2011 and Bridges Weekly, 10 April 2014, respectively)

The revised GPA has been touted by proponents as providing a greater incentive for more WTO members to sign on, given its new terms aimed at facilitating accessions.

The other changes to the deal were also partly geared toward making it more attractive to new parties, such as by adding various new entities to its coverage, including government ministries and agencies; new standards involving the use of electronic procurement tools and the improved prevention of corrupt practices; along with measures aimed at promoting environmental protections and the conservation of natural resources.

ICTSD reporting.

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